Stock Market Today: SK Hynix’s Post IPO Crash Deepens as Oil Shock Hits Wall Street

President Trump didn’t just reimpose a blockade on the Strait of Hormuz Monday. He turned the world’s most critical oil chokepoint into a toll booth, and markets spent the day pricing in what that actually means.

Trump announced the US military would retake control of the strait, positioning the country as what he called the guardian of the waterway. Under the new arrangement, vessels moving through the strait would pay a 20 percent fee on cargo, described as compensation for American security costs. 

The move came after a weekend of exchanged strikes between the US and Iran, with Tehran hitting US allied territory in the Gulf and briefly declaring the strait closed before Washington disputed that claim.

The S&P 500 slid 0.4% while the Nasdaq Composite dropped roughly 1% this Monday, while the Dow held closer to flat. Brent crude jumped more than 3% to near $80 a barrel after Trump’s announcement, with US crude following a similar climb toward $75.

Chips take the hardest hit

Semiconductor stocks bore the brunt of Monday’s selling. SK Hynix shares dropped sharply days after their red hot Nasdaq debut on Friday, when the stock had surged into the double digits. A note from a Korean brokerage warning the company could miss its next earnings target added to the pressure. Micron, Sandisk, and Seagate all posted steep declines, while AMD, Intel, and Nvidia slipped alongside the broader chip selloff.

Earnings season arrives at an awkward moment

Big US banks report earnings Tuesday, with S&P 500 profits seen up over 23% now, according to FactSet estimates for the quarter. JPMorgan, Goldman Sachs, Bank of America, Citigroup, Wells Fargo, and Morgan Stanley all report results this week, alongside Netflix, Johnson & Johnson, and UnitedHealth. New Fed Chair Kevin Warsh is also set to testify before Congress on the central bank’s policy outlook.

For now, though, traders are watching two numbers most closely: the price of oil, and how far this new blockade actually pushes it.